Winnebago Earnings: Guidance Cut Not Surprising Given Rising Input Costs and Economic Uncertainties

Winnebago’s fiscal 2025 second quarter saw adjusted diluted EPS of $0.19 beat the $0.13 LSEG consensus but also revealed dealers continue to hesitate to restock motor home inventory. Management cut its fiscal 2025 revenue and adjusted EPS guidance on continued restocking delays as well as from US tariffs, though the exact amount of tariff impact was not specified. We are lowering our fair value estimate to $77 per share from $80 after reducing revenue over our five-year explicit forecast period by 6.7% and lowering our fiscal 2025 adjusted EPS to the low point of guidance of $2.75-$3.75 (prior guidance was $3.10-$4.40) from $3.29 previously modeled. Revenue guidance is now $2.8 billion to $3.0 billion, down from $2.9 billion to $3.2 billion, and we now model about $2.8 billion because we are not optimistic about motor home dealer inventory rebounding much, if at all, in the second half of fiscal 2025. Dealers remain concerned about high interest rates affecting their inventory carrying costs and US tariffs could severely harm US consumer discretionary spending as well as raise Winnebago’s input costs for items such as some of its chassis purchases.